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Contribution of Non Oil Exports to Economic Growth in Nigeria (1985-2015)

Author

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  • Matthew J. Kromtit
  • Charles Kanadi
  • Dorathy P. Ndangra
  • Suleiman Lado

Abstract

This study examines the contribution of non oil export to the growth of the Nigerian economy for the period 1985-2015. The economy is experiencing a fall in exchange earning, a fall in GDP, depletion of external reserve, scarcity of foreign exchange, and high cost of goods. This is as a result of the sudden fall in international oil price. Thus, this forms the motivation for the study. Augmented Dickey Fuller was used to test for unit root and to ascertain the stationarity of the variables. The result showed non oil exports to be stationary at level while economic growth proxied by Gross Domestic Product (GDP) and exchange rate were stationary at first difference. Auto-regressive distributed lag (ARDL) model was then employed to ascertain the relationship between non oil exports and GDP. The Bound test conducted showed the presence of cointegration which means a long run relationship among the variables existed. The ARDL regression result indicated a positive and significant relationship between non oil exports and GDP. This means non oil exports contributed significantly to economic growth in Nigeria. The result also revealed that exchange rate had a negative though not significant relationship with GDP which is in line with economic theory. The study recommended making legislation that makes participation in non oil sectors like agriculture, solid minerals and manufacturing easy by both local and foreign investors, provision of credit at lower interest rate to the non oil sectors and direct participation in developing these sectors by the government.

Suggested Citation

  • Matthew J. Kromtit & Charles Kanadi & Dorathy P. Ndangra & Suleiman Lado, 2017. "Contribution of Non Oil Exports to Economic Growth in Nigeria (1985-2015)," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(4), pages 253-261, April.
    • Handle: RePEc:ibn:ijefaa:v:9:y:2017:i:4:p:253-261
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    References listed on IDEAS

    as
    1. Olusola Ogunjimi & Esther Aderinto & Toluwalope Ogunro, 2015. "An Empirical Analysis on the Relationship between Non-Oil Exports and Economic Growth in Nigeria," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 5(12), pages 68-78, December.
    2. Jagdish N. Bhagwati, 1978. "Anatomy of Exchange Control Regimes," NBER Chapters, in: Foreign Trade Regimes and Economic Development: Anatomy and Consequences of Exchange Control Regimes, pages 7-52, National Bureau of Economic Research, Inc.
    3. repec:hur:ijaraf:v:5:y:2015:i:1:p:190-198 is not listed on IDEAS
    4. Turan Subasat, 2002. "Does Export Promotion Increase Economic Growth? Some Cross‐Section Evidence," Development Policy Review, Overseas Development Institute, vol. 20(3), pages 333-349, July.
    5. Jagdish N. Bhagwati, 1978. "Foreign Trade Regimes and Economic Development: Anatomy and Consequences of Exchange Control Regimes," NBER Books, National Bureau of Economic Research, Inc, number bhag78-1, March.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Ekundayo Peter Mesagan & Kolawole Kushimo & Dominic Ikoh Umar, 2021. "Do fluctuations in exchange rate hinder non-oil export? An analysis of agriculture and manufacturing in Nigeria," SN Business & Economics, Springer, vol. 1(11), pages 1-23, November.

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    More about this item

    Keywords

    non oil exports; economic growth and Nigeria;

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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